Google agrees to alter advertising practices after France imposes fine

The French watchdog's decision is an attempt to rebalance the power struggle over online ads in favour of publishers

Google said it would make changes to its global advertising business to ensure it did not abuse its dominance, bowing to antitrust pressure for the first time in a landmark settlement with French authorities.

The deal with the French competition watchdog could help rebalance the power over advertising in favour of publishers, which held sway over the business in the pre-internet era but lost control with the rapid rise of Google and Facebook.

The settlement, which was announced on Monday and also saw Google fined ^220 million ($268 million), is the first time the US tech giant has agreed to make changes to its huge advertising business, which brings in the bulk of its revenue.

“The decision to sanction Google is of particular significance because it's the first decision in the world focusing on the complex algorithmic auction processes on which the online ad business relies,” said France’s antitrust chief Isabelle de Silva.

The watchdog found that Google’s ad management platform for large publishers — Google Ad Manager — favoured the company's own online ad marketplace — Google AdX — where publishers sell space to advertisers in real-time.

Ad Manager provided AdX with strategic data, such as the winning bidding prices, while AdX also enjoyed privileged access to requests made by advertisers via Google's ad services, the authority said. AdX, in turn, exchanged data more smoothly with Ad Manager than it did with other advertising management platforms. 

Under the terms of the settlement, Google made commitments to improve the way Ad Manager services worked with rival ad servers and ad space sales platforms, the French watchdog said.

Some changes would be implemented by the first quarter of 2022, it said, adding that Google would not appeal the decision.

Google also said it had agreed to make it easier for publishers to use its data and tools. “We will be testing and developing these changes over the coming months before rolling them out more broadly, including some globally,” the company added.